Digi reported its Third Quarter 2018 (3Q18) financial results last week. There are now 11.8 million Digi mobile subscribers up from 11.66 million subscribers it had as of 2Q18. The Telco added 144k new mobile subscribers between July, August and September 2018.
There are 9 million Internet users (vs 8.76 million in 2Q18), representing 76.3% of its total mobile subscribers (75.1% in 2Q18). These Internet users consumed an average 9.1GB data (per user) in 3Q18 (vs 8.2GB/user in 2Q18). Digi said that 7.5 million of its Internet users have access to the 4G LTE network (vs 7.1 million in 2Q18).
About 2.8 million Digi customers are not using any mobile Internet service. These include 314k postpaid subscribers and 2.49 million on prepaid.
About 77.4% of its mobile subscribers are smartphone users (76.1% in 2Q18). Digi sold 132k devices in the quarter (116k in 2Q18).
As of 3Q18, there are 9.07 million prepaid subscribers (vs 9 million in 2Q18), “fueled by strong postpaid growth and stronger internet uptake from prepaid although challenged by intense data price competition and continued decline from prepaid legacy services”. ARPU for Prepaid stood at RM31 (vs RM32 in 2Q18).
Postpaid subscriber base was at 2.73 million as of 3Q18 (vs 2.66 million in 2Q18). Digi said entry level postpaid plans contributed 75,000 net adds in the quarter. Postpaid ARPU remains unchanged at RM76, since 2Q18.
The Telco claims that its 4G LTE human population coverage now stands at 89% nationwide and 61% for LTE-A in 170 cities and towns.
The MyDigi mobile app recorded increase in upsell transactions of 21.9 million, with over 2.8 million monthly active users on the self-serve platform.
Digi Q3 2018 Financials:
| RM million | 3Q18 | 2Q18 | Q-o-Q | Y-o-Y |
| Service revenue | 1,475 | 1,484 | (0.6%) | (0.1%) |
| EBITDA | 725 | 743 | (2.4%) | (0.3%) |
| EBITDA margin | 46% | 47% | (0.7pp) | 0.2pp |
| PAT | 368 | 359 | 2.5% | (4.4%) |
Key Highlights (Y-o-Y), according to Digi:
- Service revenue at RM1,475 million driven by strong postpaid and prepaid internet revenue growth
- Internet revenue climbed 18.4% y-o-y to RM817 million anchored by 9.0 million internet subscriber base consuming an average 9.1GB of data each monthly
- Postpaid revenue grew 14.9% y-o-y to RM640 million over a stronger 2.7 million subscriber base
- Prepaid revenue trimmed 9.1% y-o-y to RM835 million due to intense prepaid data price competition, and moderating demand for legacy voice and messaging services
- OPEX to service revenue 33.1% from continued focus on operational efficiencies
- Earnings before interest, tax, depreciation and amortisation (EBITDA) stable at RM725 million with EBITDA margin at 46%
- Profit After Tax (PAT) steady at RM368 million with 23% margin
- Ops cash flow increased 4.0% y-o-y to RM598 million or 38% margin
- Net debt to EBITDA ratio remained sturdy at 0.7 times while conventional debt over total assets steady at 21%, well within the Shariah threshold
- Healthy third interim dividend of 5.0 sen per share or RM389 million, payable to shareholders on 20 December 2018
Digi’s CEO Albern Murty said, “This was a busy quarter for us as we focused on capturing data demand on our network while maintaining margins in the current market environment. Our strategy is to focus on our postpaid, internet and digital capabilities to efficiently deliver high-quality services to customers while being financially disciplined. And we remain deeply committed to enable more Malaysians and businesses to benefit from relevant, affordable mobile and digital services across the country.”
